Filling out the HUD-1 form after a real estate transaction is one of the most dreaded tasks in the industry. The HUD-1 form is long and detailed, especially the various tax calculations. Easy Soft’s legal real estate closing software programs take the drudgery out of this essential paperwork and do the math so you don’t have to!
Agents must calculate property transfer taxes and enter them on lines 1203 to 1205 of a HUD-1 form. These taxes differ from state to state so you can’t use a one-size-fits-all software solution. You need an application that has been designed to take into account the unique tax structure of your local area. Easy Soft’s Easy HUD software includes property transfer tax information for over 40 jurisdictions so it is able to calculate proper taxes for nearly any real estate transfer. If you happen to be in an area we haven’t covered yet, contact us and we’ll update the software to include your area. By letting the software do the work, you ensure the figures on the HUD-1 form are correct and accurate.
Of course taxes aren’t that simple. Homeowners must pay an array of charges including city, county, school, condominium and sewer taxes. When property is transferred, the buyer and the seller must each pay a proportion of these taxes relative to the amount of time the property was owned. The paid and unpaid amounts for each party must be calculated and entered in four different areas of the HUD-1 form. Proper recording of these figures ensures that each party pays a fair share of the total expenses.
Calculating the base tax is difficult enough but then prorating based on the date of sale ups the level of difficulty. You aren’t a tax accountant and yet if you make a mistake on the HUD-1 form then you could face fines or other penalties.
Kids, don’t try this at home! Instead let HUD-1 form calculate and prorate the taxes automatically based on the information you enter. The software figures out each party’s share, determines if there has been an underpayment or overpayment, and enters all figures on the relevant lines of the HUD-1 form.
OK, maybe Easy HUD doesn’t actually make real estate taxes fun but we do make them easy. Don’t keep completing HUD forms the hard way. Install Easy Soft legal software programs and let us do the work for you.